While approved office buildings proposed by the Hines Company, the Dreyfus Company and others remain unbuilt for lack of tenant commitments, three new buildings have opened this year in the county, including the 225,000-square-foot 601 Merritt 7, the final addition to an existing five-building office park on Route 7 in Norwalk.
The Mills Corporation has letters of intent from CBS 2 Chicago Broadcast Center, Boggi Milano, Sisley, Andrew's Ties, Banana Republic, Rosa Mexicano, David Barton Gym and new concepts by Steve Lombardo, creator of Gibson's Steakhouse and Hugo's Frog Bar, and Steven Foster, creator of Lucky Strike Lanes in Hollywood as future tenant commitments.
"It would have been very nice to have had a major tenant commitment prior to the start of construction, but it wasn't critical," said Mr. Alsup.
Chicago's plans foundered when EarthLink and AT&T, the two firms bidding to build its network, demanded anchor-tenant commitments.
A year later, a 10,000-square-foot free-standing retail pavilion and three additional 200,000-square-foot office buildings are expected to be ready, depending on commitments from tenants.
Three New York real estate companies will open a 45,000-square-foot building on the west side of Manhattan this week that is aimed at attracting high-tech companies interested in short-term commitments as tenants.
In turn, he said, that helped the company to secure lease commitments from tenants for a significant amount of the retail space as well as from the theater and garage operator.
"Typically in our market, developers come in and wait for a tenant to make a commitment before going into the ground," said Paul M. Jacobs, an executive vice president in the Stamford office of CBRE who is representing the project, "but this time, the owner has immediately started rebuilding even before he has a tenant".
Tenants will demand shorter commitments; that will allow them, once the lease is up, to renew at lower rents or move to less expensive, newer quarters.
Vacancy rates for quality downtown space have dropped to between 4 and 5 percent, but developers and brokers say that while prospective tenants for new buildings exist, commitments have not materialized, and without tenants there are no lenders.
If this is too much of a commitment, tenants need to make sure that they can assign the premises to another business during this time.
